IBBI Publication Highlights Insolvency and Bankruptcy Code’s Transformative Impact and Future Reform Directions
SDG 8: Decent Work and Economic Growth | SDG 16: Peace, Justice and Strong Institutions
Institutions: Ministry of Corporate Affairs | Reserve Bank of India
The Insolvency and Bankruptcy Board of India (IBBI) has released Transforming Insolvency Resolution in India 2025, a compendium of 12 research papers selected from the 3rd International Research Conference on Insolvency and Bankruptcy co-hosted with the Indian School of Business. The volume reflects nearly a decade of the Insolvency and Bankruptcy Code (IBC), 2016, examining both its achievements and evolving challenges.
Since inception, the IBC has consolidated fragmented laws into a time-bound, creditor-driven framework. By December 2024, 8,175 cases were admitted: 6,192 closed, including 3,485 rescues and 2,707 liquidations. The Code’s deterrent effect is evident from 28,818 pre-admission withdrawals involving ₹10.22 lakh crore debt. The RBI notes the IBC as the dominant recovery channel (48.1% of recoveries), with gross NPAs of scheduled banks falling to 2.54% in September 2024, the lowest since 2011.
The publication groups research into four strands. Foundational principles explore jurisprudence straying from legislative intent and the need for judicial consistency. Systemic and financial impacts cover recovery rates, bank credit growth, and entrepreneurship across Asia. Institutional and sectoral gaps include the liability of guarantors, insolvency of municipalities, and proposals to expand the role of insolvency professionals. Innovations and future tools examine predictive econometric models for CIRP timelines, distressed valuation regimes, and the role of Special Situation Funds (SSFs) in speeding NPA resolution.
The IBC has restored creditor confidence and improved financial stability, but concerns over judicial overreach, strategic misuse of CIRP, and valuation challenges remain. Embedding research insights into regulation, clarifying jurisprudence, and adopting innovative financial tools are vital for sustaining India’s insolvency framework as a pillar of its financial sector reforms.
What is IBC? → Enacted in 2016, the Insolvency and Bankruptcy Code provides a single law for insolvency of companies, partnerships, and individuals, prioritising time-bound resolution, creditor control, and revival over liquidation.
What is the mandate of IBBI? → The Insolvency and Bankruptcy Board of India (IBBI), established under the IBC in 2016, is the regulator for insolvency proceedings and professionals. Its mandate covers:
Regulating insolvency professionals, professional agencies, and information utilities.
Overseeing processes for corporate persons, partnerships, and individuals under the IBC.
Framing regulations and guidelines to ensure time-bound and transparent resolution.
Promoting research and capacity-building in insolvency law and practice.
Safeguarding stakeholder interests by balancing creditor recoveries with debtor revival where possible.
What are Special Situation Funds (SSFs)? → Special Situation Funds are a category of Alternative Investment Funds (AIFs) introduced by SEBI in 2022. They are designed to invest in distressed assets, such as loans under resolution or companies in insolvency, by providing capital for restructuring, turnaround, or acquisition. Their role is to speed up resolution of non-performing assets (NPAs) by attracting private capital into situations where traditional banks or investors may hesitate.
Follow the full news here: IBBI Publication PDF